In light of China’s wavering economy, buyers of recovered paper (RCP) imports from the U.S. and Europe are pushing for lower prices. Despite the fact that RCP shipments are set to land in China this January, China’s buyers don’t yet have 2019 import permits that would allow them to do so.

But suppliers aren’t budging – they’re optimistic that Chinese mills will continue to make even more purchases if and when the Chinese government issues 2019 quotas. It is important to note that three leading recycled packaging board producers in China’s Guangdong province have separately announced downtime plans around the Lunar New Year (which falls on February 5), which may delay purchasing. Market supply will be curtailed by a total of 328,000 tons from the beginning of 2019 to mid-February.

Purchasers in China negotiated lower prices for U.S. and European brown grades by $40-50/ton last month, claiming that the decrease in RCP collections was caused by a decrease in demand for paper and board materials.

The prices of RCP imports continue to ebb and flow.

This week, U.S. old corrugated containers (OCC) are selling for $250-260/ton, a $5-10/ton decrease compared to the prior two weeks. European premium OCC is going for $210-220/ton an overall dip of $10/ton.

Other reports state that the aggregated RCP volume collected by China between January and October was about 13 million tons, approximately 45 percent less than was accumulated between January and October 2017.

The China Paper Association predicts that total RCP imports are expected to be 15.5 million tons this year, roughly 10 million tons lower than in 2017. Domestic collections are expected to reach more than 51 million tons, a decline in 800,000 ton from the year before.

Much of China’s 2018 quotas will be left alone. Come next year, many RCP buyers and suppliers feel that 2019 quotas will continue to be cut in China. This doesn’t come as a surprise, given China’s stricter policies regarding RCP imports.

Berg Mill has a long history as one of the pioneers in the industry, and we are not going anywhere even when faced with recyclable import changes. Every day we are making progress, as new homes start to become more and more real for your material whether it be paper, plastic, metal, textiles, etc. There is no doubt that the latest news regarding the 90 day hold on increased tariffs will help the situation, only time will tell if these are only temporary tactics are more of a long term solution. If you continue to handle large amounts of recycled waste and are looking for solutions to offload idle scrap, please contact our industry veterans at Berg Mill Supply.